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EIA Natural Gas Storage Build Of +78 Bcf Misses Estimates

FXEmpire.com -

On May 23, 2024, EIA released its Weekly Natural Gas Storage Report. The report indicated that natural gas in storage increased by 78 Bcf from the previous week, compared to analyst consensus of +84 Bcf.

At current levels, stocks are 402 Bcf higher than last year at this time and 606 Bcf above the five-year average of 2,105 Bcf. High storage levels serve as a bearish catalyst for natural gas prices, although traders have focused on other drivers in recent weeks.

Current demand for natural gas is moderate, but traders continue to prepare for the upcoming cooling season, which would boost demand for energy.

It should be noted that natural gas prices in Europe have also gained solid upside momentum in recent weeks as traders prepared for warm summer.

According to recent reports, the North Atlantic sea surface temperature is at 40-year highs, which indicates that summer would be hot. Extreme heat is bullish for natural gas.

Interestingly, natural gas prices moved lower after the release of the EIA report. The storage build missed analyst estimates, which could have provided support to the market. However, it looks that traders have decided to “sell the news” and took some profits off the table after the strong rally from May lows.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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